Oversight under assault

October 23, 2009 - Mike Maneval

Democrats' efforts to create an agency responsible for consumer protection in the financial-products markets face stiff challenges, the Associated Press reports Friday. Republican Senator Richard Shelby of Alabama and banks and the special-interest groups representing them are resistant, and the House Financial Services Committee - the congressional panel more likely to support oversight - saw efforts to weaken the bill succeed, with Travis Plunkett of the Consumer Federation of America calling the legislation "battered and bruised."

Moderate Democrats on the committee exempted thousands of banks from enforcement, though the legislation still presumes compliance. Other measures exempted car dealers and title insurance providers and dropped a proposal to require banks to offer simple "no-frills" mortgages. Republicans on the committee broadly backed the amendments to weaken the concept before the final vote on the overall legislation, which then only picked up one Republican.

As Mississippi Democrat Emanuel Cleaver told the AP's Jim Kuhnhenn, "in the end. ... We have weakened legislation that the opposition is not going to support" anyways.